Hundreds of employees at Metro Vancouver Sears Canada stores and thousands more across the country are on edge today following the latest bit of bad news.
The company has announced a 15 percent drop in sales in the first quarter, posting a net quarterly loss of $144.4 million.
On the upside, same-store sales rose by 2.9 percent in the first quarter.
Sears Canada has 95 full-line department stores, 26 home stores, and 14 outlet stores, according to its 2016 annual report. It also has 69 Hometown stores and 62 Sears Travel offices.
Its six Lower Mainland department stores are at Capilano Mall, Brentwood, Metropolis at Metrotown, Coquitlam Centre, Guildford Town Centre, and Willowbrook Shopping Centre.
It closed its Richmond Centre store more than two years ago.
Sears Canada has postponed its 2017 annual shareholders meeting, which was scheduled for Wednesday (June 14), as it tries to address its "liquidity situation".
"Based on management's current assessment, cash and forecasted cash flows from operations are not expected to be sufficient to meet obligations coming due over the next 12 months," Sears Canada stated in a news release.
It had expected to be able to borrow $175 million (before transaction fees), which would be secured by its owned and leased real estate.
However, negotiations with its lenders have resulted in only $109 million being available.
"That, and the lack of available alternative sources of liquidity (through real estate monetizations, asset sales or otherwise), which may not be available in a timely manner, mean there are material uncertainties as to the Company's ability to continue to satisfy its obligations and implement its business plan in the ordinary course," the company stated. "Accordingly, such conditions raise significant doubt as to the Company's ability to continue as a going concern."